Jobs reports evolution - from "unexpected" to "worse-than-expected"

NEW YORK (Dow Jones)--U.S. stocks started the week with a sharp loss after Friday's worse-than-expected jobs data cast doubt on the pace of the labor market's recovery.

The Dow Jones Industrial Average fell 131 points, or 1%, to 12930, its fourth-straight decline. The session was the first following the labor report's release on the Friday before Easter, a holiday for U.S. markets. The Standard & Poor's 500-stock index lost 16 points, or 1.1%, to 1382, and the Nasdaq Composite slid 33 points, or 1.1%, to 3047.

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Did you notice that too? Bad jobs reports are no longer "unexpected", that's been changed to "worse-than-expected". Economists now expect the data to come out bad, but not that bad. Well, in a way, it's still "unexpected" to them.

Red State: From Hope to Hopelessness: Obama’s Economy Has 88 Million “Not In Labor Force”

It was less than a year ago that Barack Obama’s senior adviser, David Plouffe said:

After 2½ years in office, President Obama now “owns” the economy as an issue, according to top adviser David Plouffe, who added he was confident that voters understand that recovering from a devastating recession Mr. Obama inherited takes time.

“Of course he does,” Mr. Plouffe told NBC’s “Today” show host Matt Lauer when asked point-blank if Mr. Obama owns the economy.

“But the American people understand that we — it took us a long time to get to this mess,” Mr. Plouffe said. “It’s going to take us some time to come out. We are making progress.”

Well, after Friday’s jobs numbers came out (the economy added 120,000 jobs) Labor Secretary Hilda Solis promptly proclaimed: “That’s a noteworthy achievement.”

In fact, for the man who campaigned on the message of “hope” in 2008, the 120,000 jobs added is much fewer (about half) than expected and the edging down of the unemployment to 8.2% is not from job creation but from hopelessness.

There are now 88 million American who are “Not In Labor Force,” according to Department of Labor statistics, which the St. Louis Federal Reserve put into this pretty chart:

Obviously, others are seeing past Obama’s cheerleaders.

The Wall Street Journal stated:

But mostly, the picture was disappointing at a time when all eyes are on the U.S. to help keep global growth humming. The jobless rate, which is obtained from a separate survey of households, edged down to 8.2% from 8.3%, its lowest point in three years. However, that decline was due less to new hiring than people abandoning their job searches.“I’m nervous,” said Jared Bernstein, former chief economist* for Vice President Joe Biden.

* Although Bernstein, according to his bio, is not really a trained-economist (he just played one in Washington), he is right to be nervous.

And, so should the Obama Administration.

The hard truth for Barack Obama is:

People have given up.

They have gone from ‘Hope’ to Hopelessness.